Curis, Inc. (NASDAQ:CRIS) Files An 8-K Entry into a Material Definitive Agreement
ImmuNext, Inc. Option and License Agreement
Overview. On January 6, 2020 (Effective Date), Curis, Inc. (Curis or Company) and ImmuNext, Inc. (ImmuNext) entered into an option and license agreement (the Agreement). Under the terms of the Agreement, Curis has agreed to engage in a collaborative effort with ImmuNext to which Curis has agreed to conduct, at its own cost, a Phase 1a/1b clinical trial of an ImmuNext compound that antagonizes V-domain Ig suppressor of T cell activation (VISTA). In exchange, ImmuNext has granted Curis an exclusive option, exercisable until the earlier of (a) four years after the Effective Date, and (b) 90 days after database lock for the first Phase 1a/1b trial in which the endpoints are satisfied (the Option Period), to obtain an exclusive, worldwide license to develop and commercialize certain VISTA antagonizing compounds and products containing these compounds (the VISTA Compounds and Products) in the field of oncology (the Option).
A joint steering committee composed of representatives from each of the parties will manage the non-clinical and clinical development of the VISTA Compounds and Products during the Option Period, including, but not limited to, the approval of the plan for the Phase 1a/1b trial.
During the Option Period, Curis will conduct the Phase 1a/1b trial and ImmuNext will conduct certain agreed upon non-clinical research activities to support the Phase 1a/1b trial. During the Option Period, Curis is obligated to assign to ImmuNext all right, title and interest in and to, inventions made by Curis alone or jointly with ImmuNext in conducting clinical and non-clinical activities under the Agreement during the Option Period and any patent rights covering those inventions. Effective as of the Option exercise date (if any), ImmuNext is obligated to assign to Curis (i) all such inventions that were made solely by Curis and any patent rights covering those inventions that were assigned by Curis to ImmuNext during the Option Period and (ii) a joint ownership interest in all such inventions that were made jointly by Curis and ImmuNext and patent rights covering those inventions that were assigned by Curis to ImmuNext during the Option Period, except for any of those inventions that relates to compounds as to which ImmuNext has retained exclusive rights.
Upfront Payment. In consideration of the grant of the Option, Curis has agreed to make an upfront payment to ImmuNext of $1,250,000.
Option Exercise Fee. If Curis elects to exercise the Option, Curis has agreed to pay to ImmuNext an option exercise fee of $20,000,000.
Milestones and Royalty Payments. If Curis elects to exercise the Option, ImmuNext will be eligible to receive up to $4,600,000 in potential development milestones, up to $84,300,000 in potential regulatory approval milestones, and up to $125,000,0000 in potential sales milestone payments from Curis.In addition, ImmuNext is eligible to receive tiered royalties on annual net sales on a product-by-product and country-by-country basis, at percentage rates ranging from high single digits to low double digits, subject to specified adjustments.
The royalty payment obligations under the Agreement with respect to a product in a country will expire on the later of (i) expiration of the last-to-expire valid claim of the ImmuNext patents or jointly owned patents covering the manufacture, use or sale of such product in such country, (ii) the expiration of all regulatory exclusivity for such product in such country, and (iii) 10 years from the first commercial sale of such product in such country.
Program Support Payments. In partial consideration for drug substance, technical advice, and maintenance of ImmuNexts existing IND and access to ImmuNexts technology, Curis has agreed to make maintenance fee payments of $375,000 to ImmuNext on each 6-month anniversary of the Effective Date during the Option Period. In addition, Curis has agreed to reimburse ImmuNext for certain documented external costs and expenses incurred by ImmuNext in carrying out non-clinical research activities approved by the joint steering committee, up to $250,000 per calendar year, unless otherwise agreed to by both parties in writing.
Sublicensing Revenue. In addition, Curis has agreed to pay ImmuNext a low double-digit percentage of sublicense revenue received by Curis or its Affiliates.
Term and Termination. The term of the Agreement begins on the Effective Date and, unless earlier terminated, will expire upon either: (a) expiration of the Option Period if Curis has not exercised the Option; or (b) expiration of all royalty payment obligations for any and all products. Upon expiration (but not on earlier termination) of the Agreement after exercise of the Option, the license granted by ImmuNext to Curis shall automatically become fully paid-up, royalty-free, irrevocable and perpetual.
The Agreement may be terminated by either Curis or ImmuNext for an uncured material breach by the other party or if the other party files for bankruptcy or insolvency. ImmuNext may terminate the Agreement if Curis or any of its affiliates or sublicensees challenges any ImmuNext patents licensed to Curis or if Curis ceases all research, development, manufacturing and commercialization activities for the products for a specified continuous period of time. Curis may terminate the Agreement for convenience, in its entirety or on a product-by-product basis.
In the event Curis terminates the Agreement for convenience or ImmuNext terminates the Agreement for uncured material breach, patent challenge, cessation of product-related activities or filing of bankruptcy or insolvency by Curis, then all rights and licenses granted to Curis will terminate, and, subject to specified royalty payment obligations of ImmuNext, Curis will grant ImmuNext (i) an exclusive, perpetual, nontransferable, worldwide license under patents controlled by Curis and (ii) a non-exclusive license under any know-how controlled by Curis, in each case, that are necessary or reasonably useful for the exploitation of the ImmuNext compounds antagonizing VISTA or products Curis was developing or commercializing under the Agreement, and solely to exploit such compounds and products.